The following Supply Chain Matters guest blog contribution comes from Dietmar Rietsch, CEO of product information technology provider Pimcore.
All companies want to efficiently manage their supply chain to track goods (raw materials, work-in-progress assets, finished products) in real-time across their entire range of operations. For this purpose, Supply Chain Management (SCM) encompasses every relevant discipline from vendor selection and scheduling to shipping and storage. This also requires extensive communication and information sharing between various departments like purchase, procurement, sales, accounts, etc. If any corrupt data is introduced at any point in this long chain of suppliers, procurers, manufacturers, distributors, and retailers—it can throw a spanner into the works for the entire ecosystem, jeopardizing the balance between demand and supply equation.
Data Management: The Adhesive for Supply Chain
The supply chain is plagued with multiple problems such as an ever-expanding customer base, globalization, differential regulatory and trading policies, constantly evolving technology, inventory management, and warehousing-related issues. But above all else are the problems originating from inaccurate data.
So, what can a minor data error do?
Just an innocent omission of a ‘0’ in the SKU record, for example, can project diminished stocks, prolong the time of stock replenishment, and even damage the cash flow by overloading inventory beyond limits.
Therefore, companies today require modern information management capabilities to keep up with the increasingly competitive landscape and evolving customer expectations. Product Information Management (PIM) might just be the answer to all the distress vis-à-vis data.
PIM is essentially a centralized information hub and a platform to consolidate and manage all the product information steering in and out of the system. It can integrate key information and enable automatic updates, reducing the workload for companies. Such a hub helps monitor and manage all product-related information so that the enterprise can focus on other important things. Deploying PIM can ensure interoperability, reduce complexity, improve transparency, and enable better handling of “what-if” scenarios.
Here’s how SCM can be transformed with PIM:
1) Unify information: Manage materials data efficiently
By compiling a master record of all the product-related data – from specifications, engineering changes, standards, design drawings to stock codes – PIM integrates collaborative information from several departments. This unified approach gives a structure to the siloed data. It builds a single source of truth which helps in predictive and prescriptive analysis of the supply chain. It facilitates the supply chain execution, including warehouse management, forecasting, and material requirements planning and ordering.
2) Singular view of data: Improve inventory management
Teams can make the best use of data for analytics and insights only when it is visible to them. Offering a bird’s eye view of all the product data allows users the ability to analyze it holistically, including the capability to govern data over vast geographical locations and several departments. By integrating all forms of information, users get consolidated and standardized datasets at their fingertips, irrespective of the data source.
3) Better forecasting: Reduce stock-outs
Accurate, updated, and dynamic data is the key to improving supply chain forecasting. Inaccuracies generally arise when product is not available on-hand, doesn’t exist on shelf, or simply because of the absence of correct product information. Users can pin-point which products and how much of their stocks will be available in every market across geographical locations and provide that information to third-party channels as well as marketplaces.
4) Fast introduction of new products: Shorter time to market
By mapping data accurately, PIM connects all supply chain entities – from suppliers to manufacturers to distributors. With this, a streamlined and smooth communication between the sales channels and inventory is ensured, bringing all partners on the same page throughout the product lifecycle, thereby synchronizing sales channels. This creates solid grounds for quick launch of new products into the market, while updating the features of already existing ones. Users can also set the foundation for analytics, visibility, and data-driven decision making.
5) Better warehousing: Maximized logistics efficiency
Accurate product data can help optimize space, enable proper labeling (and the corresponding storage of products), as well as ensure proper product handling which directly affect costs. A PIM led stock management makes sure that every product in storage is richly labeled and has general as well as specific information about every item. Good quality product data will tell supply chain managers all they need to know about a product, while maintaining a lean approach towards inventory management.
Improve SCM by Championing Product Data
Efficient supply chain data management is the foundation for smart supply chain decisions. However, without the right platform, it can be a very complex task. Companies, therefore, must create a supply chain that’s more cost-effective and responsive by relying on a unified enterprise data strategy.